Weaker than expected retail sales, job advertisements and corporate profits figures released all supported expectations for a rate cut by the central bank at its policy meeting on Tuesday.

CommSec analyst Juliette Saly said investors shrugged off the weak data and instead bought into local stocks after the release of encouraging data on the weekend that showed a further improvement in Chinese manufacturing activity.

‘‘Our market’s taken that lead and we’ve seen some good buying coming through today,’’ Ms Saly said.

Figures released by the Australian Bureau of Statistics showed retail spending was steady in October, below expectations of a 0.4 per cent rise.

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The weaker retail figure added to expectations the Reserve Bank of Australia will cut the cash rate by 0.25 percentage points to 3.00 per cent when its board meets on Tuesday for the last time until February 2013.

Following the data, interbank futures pointed to a 75 per cent chance that the bank would ease rates.

"For many parts of corporate Australia, business conditions are as tough as in the global financial crisis," said CommSec chief economist Craig James.

"Profits have fallen for the fourth straight quarter, inventories have lifted for the fourth straight quarter and sales are sluggish across many key sectors," he said, adding there was a strong chance of a rate cut on Tuesday.

A Reuters poll showed 16 of 23 economists expect the RBA to cut its cash rate by 25 basis points to 3.0 percent, matching record lows seen during the global financial crisis.

Despite the increased expectations for a rate cut, retailers were mostly lower.

Among the top retailers, department store Myer closed down 1.8 per cent and smaller rival David Jones lost 2.0 per cent.

Defensive shares including telecoms, food and healthcare led the gains on Monday, with Telstra up 0.9 per cent, baker Goodman Fielder up 1.5 percent and blood products maker CSL Ltd rising 2.4 per cent.

Shares in Woodside Petroleum gained 0.9 per cent to $34.11 after the company announced plans to acquire a 30 per cent interest in a major liquefied natural gas (LNG) discovery off the coast of Israel in a $US1.25 billion deal.

Shares in Gindalbie Metals slumped 11.9 per cent to 26 cents after the iron ore junior completed a $40 million fully underwritten placement to institutional investors.

Among the big miners, BHP Billiton was up 15 cents to $34.54, Rio Tinto fell 21 cents to $58.54 and Fortescue dipped 15 cents to $3.76.

Among the banks, ANZ jumped 33 cents to $24.69, Commonwealth Bank surged $1.12 cents to $60.81, while National Australia Bank was one cent lower at $24.29 and Westpac was six cents higher at $25.56.